TPG fell -5.4% yesterday following the tribunal’s decision to uphold the ACCC’s original ruling, although it did bounce well off of its $4.96 low. The market was clearly optimistic about the deal with Telstra to share the network in regional areas of the country. The company maintained FY23 guidance which now includes $20-25m in one-off costs, the stock fell following the release which is logical as it’s now facing a significant infrastructure bill to build out its regional offering, though these plans are likely to take time and their cost is the big unknown at this stage, with history telling us there are always risks of a blowout in costs with undertakings such as these.
- We like the risk/reward in accumulating TPG below $5 but we are conscious of the uncertainties over the coming year.
MM is neutral to positive on TPG
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